Municipal mergers and dissolutions in Japan

There have been waves of merger activity between Japanese municipalities. The first merger, known as "the great Meiji mergers" (明治の大合併, meiji-no-daigappei), had happened in the period from 1888 to 1889, when the modern municipal system was established. Before the mergers, existing municipalities were the direct successors of spontaneous hamlets called hanseison (藩政村), or villages under the han system. The rump han system is still reflected in the postal system for rural areas as postal units called ōaza (大字). The mergers slashed ‘natural settlements’ (shizen sh¯uraku) that existed at the time from 71,314 to 15,859 cities, towns and villages, justified at the time by the increased scale and relevance of the resulting respective autonomous governing bodies.[1]

The second peak, called "the great Shōwa mergers" (昭和の大合併, shōwa-no-daigappei), took place over the period from 1953 to 1956. It reduced the number of cities, towns and villages by over half, from 9,868 to 3,472 with purposes of the establishment of a National Treasury Subsidy System. 5,000 villages were disappeared, but the number of cities were doubled.[1]

In 1965, the Special Law for Municipal Mergers (SLMM) enacted but it failed to motivate municipalities to voluntarily merge with others.[2]

Declining birthrate of Japan and very bad fiscal led the Japanese central government to promote national consolidation reform.[3]

As of January 2006, many municipalities in Japan contained fewer than 200 residents. Japanese municipalities require skilled workers. 40% of Japan's GDP consisted of debts from local governments. Japan merges local governments to expand residential area per municipal government, create different school attendance boundaries for elementary school and junior high school students, and to allow more widespread use of public facilities.[4]

After the Decentralisation movement started, based on the Omnibus Decentralization Law and an amendment to the Special Law for Municipal Mergers (SLMM) in 1999,[2] which provided strong financial and economic incentives for municipal consolidation, the central government forced municipal mergers by using incentive schemes according to special financial measures.[5]

• Grace period to keep an original grant after municipal mergers, instead of combining two municipalities. If city A received 0, city B received 100, a combine would keep 100, guaranteeing the same amount of grants.
• After mergers, the issue of special local bonds would be paid through central government grants. There special bonds provided very strong incentive for the implementation of public works to support the new merged municipalities.

Although mergers were not mandatory, the central government established the goal to decrease municipality numbers to 1,000, and used incentives to urge prefectural governments to promote merger. There are two types of merger. Absorption by one city of others, the core city retains its name, legal status, mayor and legislative body, and municipal offices, while the absorbed entity loses theirs. The creation of a new entity out of the merger cities, when a new entity is created, they receive a new legal status, create a new name and location for government offices, and form a new council.[6]

Most of Japan's rural municipalities largely depend on subsidies from the central government. They are often criticized for spending money for wasteful public enterprises to keep jobs. The central government, which is itself running budget deficits, has a policy of encouraging mergers to make the municipal system more efficient.

Although the government purports to respect self-determination of the municipalities, some consider the policy to be compulsory. As a result of mergers, some cities such as Daisen, Akita temporarily have very large city assemblies.

Some people see it as a form of federalism; they consider that the ultimate goal is to change Japan into a union consisting of more autonomous states. So far the mergers are limited to the local municipalities. Mergers of prefectures are also planned in some regions of Japan.

Suzuki and Ha's empirical research found that municipal merger in Japan during 2008 to 2014 discourages performance of legislative activity and bylaw proposals, using a dataset of 754 Japanese city-level governments. Local councils, after municipal merger, propose fewer municipal bylaws. Those mergers that created new communities appear to experience more worse performance. It also shows that enlarging municipal size is also negatively associated with legislative performance. Suzuki and Ha suggest that policy makers should consider the potential negative impact on democracy on municipal merger.[11]

Ikuta concluded that, while there are cases of successful mergers embrace the common characteristics of the region as a whole, there are as well many merged municipalities that struggled with the new shared regional image and identity. The Great Heisei Amalgamations also undertook by misunderstanding of regional brands, medium- and long-term regional competitiveness for achieving the local identity. It needed to be handled with a framework of post-merger period.[12]

Rausch suggests that post-merger policy needed a framework such as tourism policy. Rausch pointed out an example of Hirosaki City merger with Iwaki Town and Soma Village which the city tourism policy focused only on Hirosaki images.[13]

• Decentralisation in Japan

• Merger consultation, Ministry of Internal Affairs and Communications (Japanese)